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US Tariffs Threaten India’s Textile Export Competitiveness as Industry Seeks Policy Response

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July 25, 2026 0 Comments
US Tariffs Threaten India’s Textile Export Competitiveness as Industry Seeks Policy Response
US Tariffs Threaten India’s Textile Export Competitiveness as Industry Seeks Policy Response

Indian textile and apparel exporters could lose market share in the United States after Washington imposed an additional 10% tariff on a broad range of Indian goods, according to the Confederation of Indian Textile Industry (CITI). The industry body has warned that the measure places Indian suppliers at a competitive disadvantage against several Asian manufacturing hubs that have secured preferential treatment under the new US trade framework.

The tariff, introduced under Section 301 of the US Trade Act of 1974, comes on top of existing most-favoured-nation import duties and applies to a significant portion of India's manufactured exports, including textiles and apparel. Industry representatives say the additional levy is likely to increase sourcing costs for US buyers and reduce the price competitiveness of Indian products.

CITI said the competitive imbalance has been intensified by the exclusion of India from a new tariff-rate quota programme that allows eligible textile and apparel shipments from countries such as Bangladesh, Cambodia, Indonesia and Malaysia to enter the US market without the additional Section 301 duty, provided they use US-origin cotton and fibre. The industry body believes this could encourage global retailers and brands to shift sourcing away from India.

The United States remains India's largest overseas market for textile and apparel exports, with annual shipments valued at nearly US$11 billion. Any decline in demand from US buyers could have implications for manufacturing activity, employment and export earnings across India's textile supply chain, industry participants said.

Trade analysts also expect the tariff's impact to extend beyond textiles. According to estimates by the Global Trade Research Initiative, around 70% of India's exports to the US—including garments, machinery, chemicals, plastics, leather products, gems and jewellery, and furniture—are expected to face the additional levy alongside existing import duties.

The US tariff measures were introduced as part of a broader trade action targeting imports from multiple countries over concerns related to the enforcement of forced-labour import restrictions. While several product categories remain exempt, the new duties cover the majority of manufactured goods entering the US market.

As of the latest reports, India's Ministry of Commerce and Industry had not issued an official response to the industry's concerns. Exporters are expected to closely monitor the implementation of the new tariff regime and assess its impact on order flows and sourcing decisions in the coming months.

Follow CARGOCONNECT for more such updates. 

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US Tariffs Threaten India’s Textile Export Competitiveness as Industry Seeks Policy Response
US Tariffs Threaten India’s Textile Export Competitiveness as Industry Seeks Policy Response

Indian textile and apparel exporters could lose market share in the United States after Washington imposed an additional 10% tariff on a broad range of Indian goods, according to the Confederation of Indian Textile Industry (CITI). The industry body has warned that the measure places Indian suppliers at a competitive disadvantage against several Asian manufacturing hubs that have secured preferential treatment under the new US trade framework. The tariff, introduced under Section 301 of the US Trade Act of 1974, comes on top of existing most-favoured-nation import duties and applies to a significant portion of India's manufactured exports, including textiles and apparel. Industry representatives say the additional levy is likely to increase sourcing costs for US buyers and reduce the price competitiveness of Indian products. CITI said the competitive imbalance has been intensified by the exclusion of India from a new tariff-rate quota programme that allows eligible textile and apparel shipments from countries such as Bangladesh, Cambodia, Indonesia and Malaysia to enter the US market without the additional Section 301 duty, provided they use US-origin cotton and fibre. The industry body believes this could encourage global retailers and brands to shift sourcing away from India. The United States remains India's largest overseas market for textile and apparel exports, with annual shipments valued at nearly US$11 billion. Any decline in demand from US buyers could have implications for manufacturing activity, employment and export earnings across India's textile supply chain, industry participants said. Trade analysts also expect the tariff's impact to extend beyond textiles. According to estimates by the Global Trade Research Initiative, around 70% of India's exports to the US—including garments, machinery, chemicals, plastics, leather products, gems and jewellery, and furniture—are expected to face the additional levy alongside existing import duties. The US tariff measures were introduced as part of a broader trade action targeting imports from multiple countries over concerns related to the enforcement of forced-labour import restrictions. While several product categories remain exempt, the new duties cover the majority of manufactured goods entering the US market. As of the latest reports, India's Ministry of Commerce and Industry had not issued an official response to the industry's concerns. Exporters are expected to closely monitor the implementation of the new tariff regime and assess its impact on order flows and sourcing decisions in the coming months. Follow CARGOCONNECT for more such updates. 

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